FXStreet (Łódź) - Frédérique Cerisier, economist at BNP Paribas, suggests that the slowdown in Eurozone PMI to 52.8 in August sends mixed signals regarding the evolution of activity in Q3.

Key quotes

"In the Eurozone, the composite output PMI index lost in August the whole point it gained in July."

"It fell to 52.8, a level consistent with GDP growth well above zero recorded in Q2 though, around 0.3%q/q according to Markit."

"The surveys suggest that the deceleration in activity was widespread, but significantly larger in industry than in services."

"In the latter, the business activity index fell by less than a point and remained at a still comfortable level of 53.5."

"In the manufacturing sector, however, the output index, after stabilizing in July, started again to lose substantial ground. It fell by almost two points in August, and, at 50.9, suggests output is hardly increasing in that sector."

"In Germany especially, manufacturing activity and business climate is likely to be badly hit by increasing geopolitical tensions, and especially by sanctions against Russia."